Wednesday, 30 March 2022
Regulations and Determinations
Industry Research and Development (Underwriting New Generation Investments Program) Instrument 2021; Disallowance
On behalf of Senator Waters, I move:
That the Industry Research and Development (Underwriting New Generation Investments Program) Instrument 2021, made under the Industry Research and Development Act 1986, be disallowed.
This instrument is a culmination of a policy announced almost four years ago, affectionately known as UNGI. We were told it was necessary to ensure stable energy supply, but all it's done is cause chaos and havoc with energy investors and halt new energy supply. Energy businesses held off on making their investment decisions for fear that the government was handing out to their preferred coal and gas donors and they would not be able to compete with them. This isn't just rhetoric. The whole process from start to finish has been hidden from public view. There has been no grant criteria. There's just a slush fund for Minister Taylor to pick and choose which projects he wants to fund and donors are encouraged to apply.
When the shortlist was announced around three years ago it included coal plants, five gas plants and six pumped hydro projects. The department was asked over and over again how they were going to legally fund it. They did not have a clear answer. Then they tried to use the Clean Energy Finance Corporation to spend this money by creating the Grid Reliability Fund. This was opposed by the Greens, Labor and the crossbench, and the government did not have the numbers. But it didn't even get to the Senate. When it was in the House a backbencher by the name of Barnaby Joyce moved an amendment to allow the CEFC to fund coal projects. The government killed that bill and UNGI died with it. But in the months that followed, legal counsel for the government obviously came across a new way to fund coal, oil and gas projects in section 33 of the Industry Research and Development Act that allows grants to be made by regulation.
The entire Senate opposes this poor policy except for One Nation and the government. That isn't enough to pass a law to create this fund, but it is enough to prevent a disallowance because the onus is flipped so the government needs one fewer vote. That is why handout after handout for coal, oil and gas companies has been funnelled through this section of the industry act in recent months.
The scrutiny of regulations committee has serious concerns with this bill, as they did with the ARENA regulations, so these concerns should be carried through. The committee have asked Minister Taylor to respond to their concerns, and, a month on, he still hasn't written back to the committee with any justification. We may not be successful today, but we will lodge a disallowance in the next parliament.
Lismore has been evacuated and flooded for the second time this month. Water has breached the levee, and insurers are telling us that these floods are set to be the most expensive natural disaster in Australia's history. On this same day, One Nation and the government are voting to hand out more handouts to gas companies that are owned by billionaires overseas and registered in tax havens—surprise, surprise! The gas companies should be paying to clean up the damage they are causing, but instead they're getting away with our money to make floods even worse.
Despite the government's best efforts, they still couldn't get this money out the door for their coal donor Trevor St Baker, who bought Vales Point power station off the New South Wales Liberals for $1 million. It was actually worth $700 million the next year. Then a story leaked in the Daily Telegraph that they were going to get $11 million for that. In estimates, the department denied that this was true, so a cabinet minister must have leaked it. Thankfully, the UNGI scheme imploded, and they couldn't get the money out the door quickly enough. The Vales Point coal plant didn't get the money at the time they needed it, so they withdrew their application. Still, here we are, with one of the final acts of the 46th Parliament being to give more handouts to fossil fuel donors. The 47th Parliament cannot come quickly enough for some of us.
Labor has also consistently criticised the government's Underwriting New Generation Investments program since its announcement in 2018. It lacks both transparency and integrity. It has given disgraced minister Angus Taylor a blank cheque to fund pet projects, without due process. Industry and experts tell us that it will push up power prices and expose taxpayers to risky investments. The Business Council of Australia has also criticised the program, saying:
Ad hoc intervention in the energy market, such as underwriting generation investment … will only result in less investment in energy generation, less reliable energy and ultimately higher prices—
for consumers. The Australian Industry Group have said:
An underwriting program may have merit, but presents significant risks to the public purse …
Therefore, the burden will be placed on the taxpayer. They also have concerns about the integrity of Australia's electricity markets under this scheme. Labor very much shares all of those concerns. We support the role that gas will play in a transition in energy, but support for any projects—gas or pumped hydro—needs to be considered through a proper process, not through a coalition slush fund such as this one. We will maintain our opposition to this flawed program.
This instrument provides an essential mechanism to secure more affordable, reliable electricity for all Australians. On-demand reliable power, like the pumped hydro and gas projects supported by this instrument, is essential to keeping the lights on and the prices low. Critically, this instrument will support the delivery of Tasmania's Battery of the Nation pumped hydro project, which will unlock firm, flexible renewable generation that is vital for the future reliability and security of the National Electricity Market and which will support thousands of jobs in Tasmania.
A vote for this motion is supporting the destruction of economic opportunities for Tasmania. It's a vote for a less reliable grid, higher prices and higher costs of living for Australian families.
There being no further contributions, I will put the question. The question is that business of the Senate notice of motion No. 5, related to the Disallowance of the Industry Research and Development (Underwriting New Generation Investments Program) Instrument 2021, be disallowed.